Why billionaire Radhakishan Damani quietly holds these 2 cyclical chemical stocks

Two of them sit in a corner of the market most investors ignore: niche chemical processing. These are not flashy specialty chemical stories. They make boring, essential inputs that sell into global supply chains and are hard to copy because of the clearances, registrations and plant know how involved. Damani, including entities linked to him, has held both for a while.

When an investor of his weight decides to own a microcap at all, it is usually worth understanding why. Let us dive in and try to find out if we can pin down any reason for these quiet bets,

#1 Mangalam Organics: The Pine Chemistry Play & Damani’s Re-Entry

Incorporated in 1981, Mangalam Organics works in pine chemistry, turning out terpene products like camphor, dipentene and sodium acetate, along with synthetic resins used in inks, tyres, adhesives and chewing gum. It also runs small consumer brands, CamPure and Mangalam, in the home and personal care space.

With a market cap of Rs 440 cr, the company by its own account cited on Screener.in, is the world’s largest maker of camphor.

Per the exchange filings, Radhakishan S Damani held about 2.2% of Mangalam Organics for over two years. In the December 2025 filing, that stake slipped below the 1% mark for the first time in that stretch, hinting at a partial or complete sell off.

But in the March 2026 filings, it was revealed that the holding is back to 2.2% meaning a re-entry. At current values, this 2.2% holding is worth Rs 10 cr.

Market Leadership vs. Commodity Cyclicality: The Moat Assessment

Being the world’s largest camphor producer is a real edge. Camphor making is capital heavy, tightly regulated and tied to a pine based raw material chain that few can manage at scale. The catch is that camphor is still a commodity. Its price swings with demand and with the cost of imported inputs, and that makes Mangalam’s profits lumpy in a way a true specialty business would not be.

The company knows this, which is why it has been pushing its own consumer brands and higher value resins to soften the cycle. The promoters appear committed, having raised their stake to about 58.6%, but the swing in earnings is the thing to respect here.

Financial Trajectory: Navigating a Leverage-Backed Capacity Expansion

The numbers show exactly that cyclicality. Here EBITDA, or earnings before interest, tax, depreciation and amortisation, is the operating profit before other income.

Financial Year	FY21	FY22	FY23	FY24	FY25	FY26	5-Yr CAGR
Sales (Rs cr)	338	491	493	494	530	623	13%
EBITDA (Rs cr)	128	91	-3	39	59	88	Turnaround
Net Profit (Rs cr)	85	54	-27	4	13	26	Turnaround

Sales have grown at about 13% a year over five years. But look at the profit column and you can see the story. FY21 was a camphor price boom, with net profit of Rs 85 cr. Then prices cracked, and FY23 was an outright loss of Rs 27 cr. Since then, the company has clawed its way back, with profit rising from Rs 4 cr to Rs 26 cr. Same is the trajectory for EBITDA.

However, a single five-year CAGR for EBITDA or net profit is misleading here. The FY21 boom and the FY23 loss distort it, so the year-by-year figures tell the truth better.

One thing to watch is debt. Borrowings have climbed from about Rs 20 cr in FY20 to roughly Rs 359 cr, as the company funds new capacity, and free cash flow has been negative for two years on the back of that spending. Interestingly, even as Damani has trimmed, domestic institutions have edged in, lifting their holding to about 3.6% by early 2026.

Share Price Performance and Valuation Metrics

The share price of Mangalam Organics was around Rs 785 in June 2021 and as of closing on 16^th June 2026 it was Rs 519, which is a big drop.

At the current price, the stock is trading at a discount of over 60% from its all-time high of Rs 1,300.

Regarding valuation, the stock is trading at a PE of 15x which is lower than the current Industry median of 23x. The stock is roughly 1.2 times its book value of Rs 372, so it is priced close to the value of its assets rather than for high growth.

#2 Bhagiradha Chemicals: Damani’s Agrochemical Bet

Promoted in 1993 by the late S. Koteswara Rao, a former scientist at the Indian Institute of Chemical Technology in Hyderabad, Bhagiradha Chemicals makes agrochemical active ingredients. Its portfolio runs to more than 30 active ingredients, including the insecticide chlorpyrifos, fungicides, herbicides and specialty intermediates. Its plant sits near Ongole on the Andhra coast, and it exports to markets across the world.

With a market cap of Rs 3,370 cr the company serves a diverse customer base of 100+ domestic and 25+ multinational clients, mainly Tier II and Tier III players in global markets. It also exports its products to various countries including USA, Brazil, UK, France, Malaysia, New Zealand, and Australia.

Here the Damani link runs through Derive Trading and Resorts, a holding company in his group. Per the filings he has held about 3.3% of Bhagiradha steadily since the middle of 2024, worth close to Rs 74 cr in the December 2025 filing. Unlike Mangalam, this position has not been trimmed.

High Entry Barriers: Deconstructing the Asset-Heavy Growth Engine

Making agrochemical actives is not the same as blending finished pesticides. Each molecule needs product registrations, environmental clearances and a complex, hazardous manufacturing process that takes years to set up.

Once a maker is approved and embedded in a global customer’s supply chain, it is sticky. That is the barrier, and it is a genuine one. New entrants cannot simply build a plant and start selling; the approvals alone can take years.

Navigating a Global Downturn and Capex Expansion

Bhagiradha has just been through an agrochemical downturn, when a global glut of supply and heavy destocking by buyers pushed prices down across the industry. Chlorpyrifos and a few key molecules drive much of its revenue, and a chunk of sales goes to export markets, so a worldwide price slump hits it directly.

Financial Year	FY21	FY22	FY23	FY24	FY25	FY26	5-Yr CAGR
Sales (Rs cr)	318	436	502	408	440	536	11%
EBITDA (Rs cr)	47	68	77	43	37	57	4%
Net Profit (Rs cr)	23	36	45	18	14	18	-5%

Sales have grown at about 11% a year over five years, with FY26 sales up a strong 22% as demand recovered. But profit peaked at Rs 45 cr in FY23, fell through the downcycle to Rs 14 cr, and has only just begun to turn.

The bigger development is on the balance sheet. Fixed assets jumped from about Rs 245 cr to Rs 581 cr in FY26 as a large new plant came online, funded by fresh equity and debt. Return on capital employed has dipped to about 5% while that capacity ramps up, meaning roughly Rs 5 of profit for every Rs 100 of capital, well below its earlier levels.

Share Price Trends and the 185x PE Multiplier

The share price of Bhagiradha Chemicals was around Rs 60 in June 2021 and as of closing on 16^th June 2026 it was Rs 260, which is a 333% jump in 5 years.

At the current price, the stock is trading at a discount of about 42% from its all-time high of Rs 448.

As for the valuation, the share is trading at a PE of a huge 185x while the industry median is just 23x. That headline PE looks frightening, but it is high mainly because profit is at a cyclical low while a big new plant has just started up.

If utilisation and margins recover, earnings could rise sharply and that multiple would compress fast. The board has also kept paying a small dividend through the slump, and operating margins ticked up again in the latest year, both early hints that the worst of the cycle may be behind it.

Red Flags to Watch: Low Promoter Holding and Negative Free Cash Flow

Two things stand out. Promoter holding is low at about 19.6%, and has slipped over the past three years, which is worth watching. And free cash flow has been deeply negative because of the plant spending, so the recovery thesis leans heavily on the new capacity actually filling up. This is a bet on operating leverage, not on a cheap valuation.

The Damani Filter: Key Takeaways

Put the two side by side and a logic emerges. Both are niche, asset backed chemical makers with real barriers to entry. Both are cyclical. Both have just spent heavily on new capacity. The difference is in the recent record and the runway. One has rewarded patience and is holding its course in his book. The other has tested it, and he has been letting it go.

For a retail investor, the takeaway is not to copy the trade. It is to notice the filter. Damani is not chasing the loud manufacturing themes of the day. He is sitting with hard to build chemical franchises and quietly sorting the ones that are compounding from the ones that are merely surviving.

Both names are cyclical and carry real risks, from commodity swings to stretched balance sheets. The next year of results, as the new plants ramp up, should reveal which way each cycle is turning. As a window into how careful capital sifts a tricky sector, the pair is worth putting on a watchlist and following closely.

Disclaimer:

Note: We have relied on data from http://www.Screener.in and http://www.trendlyne.com throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information.

The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.

Suhel Khan has been a passionate follower of the markets for over a decade. During this period, he was an integral part of a leading Equity Research organisation based in Mumbai as the Head of Sales & Marketing. Presently, he is spending most of his time dissecting the investments and strategies of the Super Investors of India.

Disclosure: The writer and his dependents do not hold the stocks discussed in this article. The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein.